Google yesterday gained federal authority to buy and sell power in the U.S., granting it essentially the same status as a power utility. Google's headquarters is seen here blanketed in solar panels. (Source: Goozner Solar)

Google could eventually use the approval to sell renewable energy directly to U.S. consumers. (Source: Wind Revolution)

Traditional power utilities have a new competitor

The
world of power utilities in the U.S. is a story of old business.
The corporate landscape is almost as stale as
America's power grid -- there's little fresh blood.

That
could soon change. Adding to the shakeup that began earlier
this week with President Obama's decision to back
new U.S. nuclear construction with guaranteed loan funding,
Google yesterday received
approval [PDF] by the U.S. Federal Energy Regulatory
Commission (FERC) to become an open market seller and buyer of
energy.

While the decision of Google to enter
the power business may seem a strange one, it actually makes
sense. The search business (as well as Google's numerous other
services) require vast
farms of servers to power billions of requests worldwide.
These data centers using a tremendous amount of power. Thus
it's in Google's best interest to try to ensure reliable, affordable
power.

Google also will look to use its newfound abilities to
make good on its motto "do no evil" by adopting power from
renewable sources. Thanks to the approval, the company can now
directly buy power from renewable energy installation, rather than
having to purchase it second-hand through a utility.

The
company, which has invested in numerous
alternative energy projects of its own, could even enter the
power production business eventually. In its application Google
requested the authority to "act as a power marketer, purchasing
electricity and reselling it to wholesale customers."

In
the short term, Google has "no plans" to sell power
according to Google spokeswoman Niki Fenwick, speaking
toThe
Wall Street Journal last
month. She states in a recent
email, "We made this filing so we can have more flexibility
in procuring power for Google's own operations, including our data
centers. FERC authority will improve our ability to hedge our
purchases of energy and incorporate renewables into our energy
portfolio."

The company's foremost objective is carbon
neutrality -- emitting no more carbon than it takes in. Google
has already employed diverse means to achieve this goal. It has
used goats
to mow the lawns of its California facilities and has
invested in unusual sources of alternative energy, such as deep
geothermal and high energy wind power.

Google currently
has no wholesale electrical generation or transmission facilities
according to its filing.